Oct

25

Under the Volcano

Filed Under B2B, Blog, Financial services, Industry Analysis, internet, news media, online advertising, Publishing, social media, Uncategorized, Workflow | Leave a Comment

As the 1990s turned into the dotcom boom, we used to play a game which we named for Malcolm Lowry’s classic novel. Since we were a bit sniffy about the term “disintermediation”, the game was played by each contestant naming an industry which we thought was about to be edited out of the value chain by the reality of virtual communications. We then argued the case for its eventual extinction, and took a secret ballot on the arguments. I can recall the music industry, real world betting shops, cinema, and much retail banking disappearing that way. Now I look round and see that businesses still exist in these spaces. We were smart, but not smart enough. We reckoned without the powerful drive to “re-intermediation” – players moving to a spot where they could add value of a different type more appreciated by a networked marketplace – and we certainly did not see that most of the blighted industry activity would drift on for another few decades, ever more marginal, but representing value to diminishing populations of addicts who are willing to pay more and more to sustain their “fix”. When I went to the US last week my daily newspapers in the village shop cost me £3.00; on my return they cost £3.40. I have both these papers as Apps, and this has become my preferred way of reading them, but do I really want to attack the economic basis of the village shop? Disintermediation is much more complex than I thought in 1999.

And I never won the competition. My candidate for volcanic disruption and extinction was always advertising and PR agencies. According to Sir Martin Sorrell, who should know, these have now disappeared entirely, but I suspect that this is because he has renamed his world-leading enterprizes “data and marketing agencies”. But two events brought all of this to mind. In the first place I saw a headline which said, on October 6, “PR Newswire and Ektron Strike Up One-of-a-kind Strategic Alliance”, and then I had the pleasure of listening to and questioning David Levin, CEO of UBM, at the Outsell Signature Event in Phoenix last week. (Pause for Plug and statement of interest: I work part-time for Outsell, I moderated parts of this meeting, I know of nowhere else in the industry where you can speak with CEOs in depth under Chatham House rules – I cannot tell you what they said – but for sheer depth and understanding talking to Scott Key (IHS), Y S Chi (Elsevier) and David Levin is a bargain at any price, though here it was surrounded by case studies in change from another 13 CEOs and senior executives. Miss it at your Peril – it will be in Europe next year! Obviously I am not going to quote the views of David Levin, and no information market disruptor is ever wise to predict the demise of a part of his customer base while they are still buying services, but I left the room more and more convinced that the “strategy and monitoring” role of these agencies is beginning to shift, even if the creative role stays in place.

So what is this interesting strategic alliance at PRN all about? For me, it is simply another stage in the coupling of PR releases with media response measurement with market response measurement. The Press Release of yesteryear, that single page of grey, effusive but cautious text with the typical note for editors on the participants has given way to documents built around demos and video presentations, with multiple media input, intended to ring bells not only amongst media commentators, but to awaken financial analysts and gain general- to-specialist network user reaction. The destination of much of this stuff is social networks and You Tube. The idea is to launch the communication and then track it, and then track the ripples of activity that circle out from it, in blogs and tweets, and then to be able to take part in, redirect, respond, learn from the feedback loop. Increasingly this seems to be what marketing departments do, and increasingly they can do it for themselves (countless book publishers – yes, even them! – use a simple  package to launch a seperate web presence for every book published, using as tools the Superdu components, which any marketing assistant can handle). So, PR Newswire, as the largest distributor of “press releases” (www.prnewswire.com), now moves into media monitoring by plugging its PR Newswire Sync application into Ektron’s widely used corporate marketing web management platform (www.ektron.com). The vital part of all of this is the PR Newswire Listening Dashboard, which enables a primary analysis and social media monitoring tool. This reminds me of something I have been watching for a long time – the evolution of the old Durrants media monitoring outfit into Gorkana (http://www.gorkana.com/group/#index), where the emphasis is on the analysis. Whether we are talking CRM (corporate relationship management) or product launch, it seems to me that more of the game is now managed inside the corporate marketing function, more analysis can be done there with these tools, and more strategy can be created there than ever before. No wonder Sir Martin and his merry men are building the world’s largest data dump of consumer buying decisions, to get “predictive insight” into likely purchasing outcomes: they must add value now by the shovel load, since a whole sector of their traditional skills has been peeled off and re-installed as workflow on the desktop of the most lowly (and low paid) marketing department operative. One of Ektron’s largest customers is the UK National Health Service!

Some people will say that this is reskilling an industry that had very few skills to start with. Other, kinder, souls will point to the continuing need for creativity, and I can see re-intermediation happening already. Typical would be Jeremy Swinfen Green’s Amberlight Agency (www.amber-light.co.uk). Meeting Jeremy recently for the first time in 15 years (as a young digital ad-man he helped me carry the argument for AdHunter (later launched as Fish4) in a Cotswold country house hotel before a very dubious Northcliffe board) I began to see, through his practise as a very busy Human-Computer Interface (HCI) advisor where this fragmentation of skills was taking us. Anyone for a game of Under the Volcano? I am still gong to choose advertising and PR for the lava and hot ash…!

Aug

22

Telling the Truth about Content

Filed Under Blog, Industry Analysis, internet, mobile content, news media, online advertising, Publishing, social media, Uncategorized | 2 Comments

Here on the South Shore of Nova Scotia, where I find myself in annual joyous residence, we are all  fairly laid back about the big issues that seemed so front of mind in frenetic London. Let the market decide (a good philosophy if you have a strong economy based on extracting much-needed natural resources, and well-regulated banks that stayed upright when the rest of us fell over) seems to be the order of that day. Nova Scotians do not appear to panic easily so the absence of crisis-creating media exposure is part of the joy of being here. And being in Canada I have revisited the excellent website of the Toronto IP lawyer James Gannon. And I would in particular recommend to anyone the masterly satirical essay entitled “How I Learned to Stop Worrying and Love the Copy “. (http://jamesgannon.ca/2011/04/15/how-i-learned-to-stop-worrying-and-love-the-copy/).

Towards the end of his piece Mr Gannon quotes Michael Geist as saying “The truth is that you can compete with free if you provide value” and this simple  statement has been giving me pause for thought as I walk the beach on my morning constitutional. What is it about this simple statement that has proved, in the last 30 years, so very hard to understand in the pre-internet content industry? We have, after all, a superb communications pipeline at our disposal, and it efficiently allows us to source all pre-existing media content through that pipeline. Those who do not wish to communicate in this way would be wise to withhold their content entirely from the network, since if they do not then one of two things will happen: they will be marginalized by competitors or, if the content has interest or relevancy, “outed” into the open web and illicitly re-used for free.

So “content” for its own sake is not a valid business model anymore? I think this is true now and will become much more obvious as time goes on. This is why putting firewalls around things only creates a temporary windbreak, not a permanent end to the forest fire. The valid business model is now service, and if we pitch the service solution correctly then we get adhesive customers, renewable revenue flows, and distance ourselves from that commoditization of content that increasingly afflicts the content value model. In fact, we should struggle to make our content available as widely as possible, implanted in our customer’s web environment, and maintained as a constant reminder of the tiered service value we can add. Tiers of service which begin with the App, and move forwards through customization and personalization of content to customization of analysis and focus. And that ziggurat of value is a climb where we cannot slacken for a moment, since competition will be fierce, and where we can never quite glimpse the summit, since value requirements will change over time.

Quite soon in this process much of the underlying content which we are so busily trying to protect will become a shadow presence, referenced and referred to but seldom read as such. Its presence will be taken for granted and content derived from the network process itself will assert its importance. As we move to this point it will appear absurd to be worrying about the underlying ownership status. I was reminded of this when looking at Amazon’s social reading initiatives, which seem to have edged into the market earlier this year without much public comment. This development (https://kindle.amazon.com/) competes with Amazon’s own Shelfari acquisition, and sites like Goodreads or Library Thing. If you were a publisher of general consumer books, surely this is the value point at which your acquisition policy would be focussed? And once you had readers who recorded all of their purchases and shared them with others on your site, including your books as well as your rivals, and you opened up the site to allow users to make comments on what they are reading, add footnotes, review, argue and correct, and then (as Amazon has done) you connected all this to Twitter and FaceBook, or in education to emerging social spaces around rentals like Chegg, then you are beginning to climb that value chain.

And then comes monetization. Some service values will be select, minority interests with strong membership and therefore subscription characteristics. Others will be populist, sponsored or maintained through online advertizing. The value we will seek to protect here is the service value, usually a function of underlying software and the way it works on content. And between visits to the patent courts to try to secure the unsecurable for 15 years, we will keep enhancing, changing, building the customer experience and competing through our ability to analyse the user experience and improve it.

Publishers used to do that last bit very well. They could do it again if they would relax around the content and follow the game. At the moment who do you see emerging on top? Amazon or one of their major publisher suppliers? No comment on that from my end of the beach, but you can always see who is winning by their willingness to be reasonable and offer concessions to the flagging pack following them.

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